Behavioral Red Flags of Fraud

There are a number of common signs that we may see when someone is engaged in financial fraud within a company. Tracy talks about the behavioral red flags for fraud in this video, which are also summarized below:

Situational pressures that may lead to fraud can include:

Personal financial problems, such as high debts, bankruptcy, child support obligations, spousal support obligations, or investment losses

Family or relationship struggles, especially if they involve money

Instability or emotional trauma in one’s personal life

Significant illness, leading to time away from work or substantial medical bills

Addictions, such as alcohol, drugs, or gambling

Criminal background, which may suggest dishonesty, but may also create difficulties in obtaining and sustaining employment

Chronic legal problems, which can be expensive and time consuming,

Infidelity, which involves dishonesty and requires funds concealed from the spouse